Chris
I now use PS7 but "cut my teeth" on PS Elements. I also had PS 5.0 LE. I opted for elements because most of the magazines etc. were geared towards it and eventually, found there was little that couldn't be done on Elements. PS 5.0 though, had quick mask which is brilliant and wasn't on PSE. I've heard though that it, or something close to it, is in PSE 2.0. You should be able to use them both, depending what you want.
Anyway, I now use PS 7.0 because..... well, because. Bob's spot-on saying that you don't need PS 7.0 and from what I've read other editors are snapping at Adobe's heels especially, within the enthusiast market.
Digital editing is easy and complex. I constantly struggle with this aspect of photography (as well as all the others!). I reckon that whatever you learn in one application will transfer to another even if the interface is very different (IMHO). What you develop is the skills to edit a picture using a variety of tools. The tools might be called something else or found/applied differently but what you have with regard your photos is the same....
Anyway, have fun.
Martin